Eigen layer projects lock more Ethereum LSTs, can they maintain this value?


  • Eigen Layer takes over locked, stacked Ethereum and produces modern assets through “re-staking”
  • Eigen Token is in the process of airdrop to eligible wallets
  • Over 43% of the ETH supply is currently locked or staked
  • Eigen Layer Releases New Profit and Return Calculation Tool, Making Web3 Decentralized Finance More Complex

Eigen Layer is the leading protocol for depositing Ethereum liquidity staking tokens (LSTs). The protocol allowed tokens to flow without restrictions since February and was eventually blocked Liquidity at $13.65 billion as of April 2024, shortly after growing to over $16 million.

The Eigen protocol is set to change the Ethereum ecosystem by locking up even more free coins while creating modern asset classes. The Eigen token is also in the application stage and is being distributed to eligible wallets.

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The value comes from the activities of Actively Validated Services, i.e. modern start-up projects built on the basis of Eigen Layer. There are currently 14 such projects, and more will appear in the future, which will likely issue their own tokens. However, according to user @chudnovglavniy, a liquidity crisis is coming as projects inflate their nominal value.

This reported liquidity is significantly higher compared to the reported LST locked in the protocol. According to Eigen Layer’s own statistics, the protocol carries approximately 1.082 million LST. The locked LSTs are worth $3.49 billion based on ETH’s market price of $3,216.67.

The Eigen layer removes deposit restrictions

From April 16, Eigen Layer launched a modern deposit campaign, removing all limits on modern LST inflows. The renewed inflows come from several types of LSTs: ankrETH, osETH, xETH, wBETH, swETH, oETH, stETH, cbETH, ETHx. Eigen Layer will also be constantly adding modern LST types to get as much liquidity as possible.

The removal of limits sets the expectation for a “summer of the Eigen layer” in which glossy staking will lead to the creation of modern value. However, such a growing ecosystem can also become risky because it creates a modern selection of tokens with potentially inflated value.

Staking is also often used to obtain potential rewards and airdrops that include NFTs. It is complex to estimate the real value of these projects and not all of them will survive the first months of enthusiasm.

How much ETH is available for re-staking

Hypothetically, they exist over 43 million ETH which can be converted into liquidity tokens. At least this amount of deposits is already included in the official staking agreement.

Truly created liquidity tokens they have a much lower supply and a market capitalization of around $31 billion. Lido Staked ETH has a supply of 9.33 million tokens and is one of the largest providers of Eigen Layer.
However, even after lifting deposit limits, only approximately 9,899 LsETH was deposited in the Eigen layer intelligent contract. Over time, the long list of liquidity tokens slowly grows and builds the foundation for Eigen Layer security and liquidity. Still, the potential for depositing ETH-based tokens is lower compared to rapidly generating value based on derivative tokens, airdrops, and rewards.

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